Legislature(2023 - 2024)BELTZ 105 (TSBldg)
04/24/2024 01:30 PM Senate LABOR & COMMERCE
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| Audio | Topic |
|---|---|
| Start | |
| SB257 | |
| SB235 | |
| HB97 | |
| HB29 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 235 | TELECONFERENCED | |
| += | HB 97 | TELECONFERENCED | |
| *+ | HB 29 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | SB 257 | TELECONFERENCED | |
HB 29-INSURANCE DISCRIMINATION
2:06:22 PM
CHAIR BJORKMAN reconvened the meeting and announced the
consideration of CS FOR HOUSE BILL NO. 29(JUD) "An Act
prohibiting certain insurance decisions based solely on a
person's status as an elected official."
2:06:46 PM
REPRESENTATIVE KEVIN MCCABE, District 30, Alaska State
Legislature, Juneau, Alaska, sponsor of HB 29, provided a
statement promoting the bill. He said insurance companies are in
the business of discrimination. They segregate the insured into
separate risk pools based on their differences in risk profiles
for two main reasons: so that they can charge different premiums
to the different groups based on their risks and actuarial
tables, and to incentivize risk reduction by the insured.
REPRESENTATIVE MCCABE said there are, however, limits to the
type of discrimination that insurers can engage in. These
discrimination restriction decisions are decided at the national
and local levels of government, and laws on discrimination and
intensity of regulation vary a great deal in each jurisdiction.
He said insurance companies have been denying coverage to
Alaskans based solely on their political affiliation,
expression, and/or elected status. He said HB 29 aims to put an
end to such discriminatory practices by explicitly prohibiting
insurance discrimination based on expressly forbidding insurance
solely on factors such as political affiliation, expression or
elected status, especially elected status. Through a floor
amendment in the other body, the bill has been approved to its
current form, expanding the scope of protection to encompass all
aspects mentioned and now summarized as the person's status as
an elected official. Specifically, he said House Bill 29 amends
the insurance code in Alaska from using a person's status as an
elected official as the sole reason to refuse to insure or
refuse to renew insurance coverage, limit the scope of insurance
coverage, cancel an existing insurance policy, deny a claim
covered by an existing insurance policy or increase the premium
policy fees or rates charged on an insurance policy above what
their actuarial tables say it should be. He emphasized that HB
29 would not prohibit refusals, limitations or fees that are
based on sound underwriting or actuarial principles. Given that
insurance products are necessary to protecting health and
property, and in some instances are required by law, he said it
is in the public interest to ensure that consumers are protected
from discriminatory practices. He said HB 29 would help in that
effort.
2:10:08 PM
SENATOR DUNBAR commented that HB 29 would create a protected
class and asked what the other protected classes are. He
specifically asked what other factors insurance companies can
use to discriminate against people.
2:10:28 PM
REPRESENTATIVE MCCABE said he did not think HB 29 would create a
protected class. He said it would protect a class from
discrimination just because they are an elected official. He
reported that he selected an umbrella policy prior to his
election and after his election was informed that he could no
longer purchase that policy, because he had been elected. He
learned that other lawmakers had similar experiences. He
subsequently learned that the same limitation applied to
assembly members and school board members.
2:12:09 PM
SENATOR DUNBAR said there may be a semantic disagreement about
what a protected class is. He said HB 29 would be an example of
the law inserting itself in a private business contract to say
that an individual cannot be discriminated against based purely
on a given status, for example, veteran status, race, gender,
etc. He noted that is done frequently in law, because some
groups need that protection and pointed to the sponsor's
experience in which he was discriminated against based purely on
a status unrelated to the transaction in question. He restated
his question, asking what other groups are protected in that
insurance coverage can not be denied to them based on their
status.
2:13:28 PM
REPRESENTATIVE MCCABE deferred the question to his staff.
2:13:36 PM
JULIE MORRIS, Staff, Representative Kevin McCabe, Alaska State
Legislature, Juneau, Alaska, said the director of the Division
of Insurance was available to answer questions.
2:14:00 PM
CHAIR BJORKMAN asked whether the actuarial tables are public
information. He further asked whether someone seeking insurance
could research the tables to determine whether they were getting
[information that aligns with the actuarial tables] from an
insurance company.
2:14:20 PM
REPRESENTATIVE MCCABE said he had seen actuarial tables. He said
he wasn't sure they were publicly available. He deferred to the
representative from the Division of Insurance.
2:14:56 PM
SENATOR GRAY-JACKSON asked for the definition of an umbrella
policy.
2:15:05 PM
REPRESENTATIVE MCCABE replied that an umbrella policy offers
higher value because it covers multiple items under one policy
and gave examples. He said an umbrella policy may also raise
limits for unusual or atypical damages or injury.
2:16:37 PM
SENATOR GRAY-JACKSON asked whether the limitation he described
was only for umbrella policies or if there were other
limitations that the insurance company imposed. She asked if
there were other limitations on an insurance policy due to his
status as an elected official.
2:16:57 PM
REPRESENTATIVE MCCABE replied he did not explore the issue
beyond discovering ineligibility for an umbrella policy because
he was an elected official.
2:17:50 PM
SENATOR MERRICK joined the meeting.
2:17:59 PM
LORI WING-HEIER, Director, Division of Insurance, Department of
Commerce, Community and Economic Development (DCCED), Anchorage,
Alaska, said statutes are written so insurance companies can
discriminate but cannot unfairly discriminate, meaning that
anything to do with race, gender, religious affiliation, the
state would not allow refusal of a policy on that basis. She
said she contacted several independent brokers and they
confirmed that they would not be able to underwrite umbrella and
certain other policies for members of the legislature, as well
as elected officials of municipalities. She also noted that
several other states are dealing with the same thing and are
working to pass similar legislation. She said she was previously
unaware of the issue. She said HB 29 has merit for people
occupying all levels of elected positions.
2:19:37 PM
SENATOR DUNBAR asked whether the limitation to insure was issued
at a local level or at the direction of a national insurance
company with an established policy [to deny coverage].
2:19:54 PM
MS. WING-HEIER affirmed the policy not to underwrite would be at
the national level as a rule of underwriting.
2:20:27 PM
CHAIR BJORKMAN asked how [someone seeking insurance] would know
the rate they are offered by an insurer coincides with an
actuarial table.
MS. WING-HEIER said insurance rates are available to the public
once the Division of Insurance approves them. She said they can
be accessed through the National Association of Insurance
Commissioners (NAIC).
2:21:19 PM
CHAIR BJORKMAN asked for confirmation that there is a database
provided by the NAIC that the public can access to verify all
types of insurance rates.
MS. WING-HEIER affirmed that, though the tables may be difficult
for the general public to understand, the information is
available and if there is a concern, the Division of Insurance
is available to assist [the public].
2:21:53 PM
CHAIR BJORKMAN [held HB 29 in committee].